What Are Liquid Funds?
Definition: Liquid funds are a type of mutual funds that invest in securities with a residual maturity of up to 91 days. Assets invested are not tied up for a long time as liquid funds do not have a lock-in period.
Description: Return is not guaranteed as a fund’s performance depends on how the market performs, unlike fixed deposits which are not dependent on the market. Investors looking for better returns prefer investing in a liquid fund over a fixed deposit.